Businesses and industry continue to require and consume increased amounts of electric power. One reflection of this trend is growing interest in self-generation of electric power, either to replace or to supplement that delivered by load-serving entities and utilities over the existing electric power distribution grid. Distributed energy resources (DER) are power generation technologies and demand reduction technologies located close to where electricity is used (e.g., a home or business) to provide an alternative to or an enhancement of the traditional electric power system.
The employment of small-scale power generation capability at a local commercial or industrial facility has become known as distributed generation (DG). Most owners and operators of DG systems lack sophisticated controls and functional software to optimize the performance of their systems. This usually results in under-utilization of DG assets and unfavorable economics for DG projects. In addition, most end-users of electric power do not want to become experts in microgeneration. While the number of DG assets increases, much of these sit idle, and owners lack the capability to access wholesale power markets or sell this excess generation capacity back to the electric power distribution grid.
Most commercial and industrial facilities also have the capability to temporarily reduce their demand for electric power from the electric power distribution grid either in response to local operating conditions or external conditions of the electric power distribution grid. Most facilities lack sophisticated controls and functional software to optimize the employment of temporary demand reduction systems or capabilities and to record this activity for historical tracking purposes and credit in wholesale power markets. This usually results in an underutilization of demand reduction systems or capabilities and unfavorable economics for such projects. While new “smart” appliances and other enabling technologies have become more common, much of this capacity sits idle, and owners lack the capability to access wholesale power markets or sell temporary demand reduction back to the electric power distribution grid.